It didn’t take long for markets to resume their climb upwards as U.S. stock index futures advanced 0.7% overnight to rebound from yesterday’s selloff. Major indices slumped 2% on Tuesday amid fears about a second wave of coronavirus infections
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Tuesday’s Session was Cycle Day 2 (CD2): Early attempts to breakout above 2940 handle failed as increased selling pressure trapped buyers. Violation of prior key support 2895 attracted additional selling as the gauntlet was thrown down with long liquidation pressing price to session lows by the closing bell.
…Transition from Cycle Day 2 to Cycle Day 3
This leads us into Cycle Day 3 (CD3): Having closed near low of session we then have Two Scenarios to consider.
1.) Price continues lower targeting 2825 CD3 Violation Level (FULFILLED DURING GLOBEX) which matches with May 6st Pivot Low. Failure to hold this level opens trap door to lower 2797.
2.) Price finds supportive bid preferably above Prior Low (2838) as bulls work to recover lost Cycle Day 1 Low (2889.75) before end of session, otherwise this Cycle will be marked as “failed”. (9% probability)
*****3 Day Cycle has a 91% probability of fulfilling Positive Statistic covering 12 years of recorded tracking history.
PVA High Edge = 2931 PVA Low Edge = 2900 Prior POC = 2920
Bull Scenario: IF Bulls hold bid above 2865, THEN initial upside estimate targets 2875 – 2880 zone.
Bear Scenario: IF Bears hold offer below 2865, THEN initial downside estimate targets 2850 – 2845 zone.
Range Projections and Key Levels (ES) June 2020 (M) Contract
Nasdaq 100 (NQ)
Today is Cycle Day 3 (CD3)…Price has fulfilled Positive 3 Day Cycle Statistic recovering CD1 Low (9118.50)
PVA High Edge = 9324 PVA Low Edge = 9256 Prior POC = 9273
Bull Scenario: IF Bulls hold bid above 9145, THEN initial upside estimate targets 9160 – 9170 zone.
Bear Scenario: IF Bears hold offer below 9145, THEN initial downside estimate targets 9135 – 9120 zone.
Range Projections and Key Levels (NQ) June 2020 (M) Contract
Trade Strategy: Our tactical trade strategy will simply remain unaltered…We’ll be flexible to trade both long and short side from Decision Pivot Levels. Continue to focus on Bull/Bear Stackers and Premium/Discounts. As always, remaining in alignment with dominant intra-day force increases probabilities of producing winning trades.
Stay Focused…Non-Biased…Disciplined ALWAYS USE STOPS!
“Knowing is not enough, We must APPLY. Willing is not enough, We must DO.” –Bruce Lee
*****This trade strategy report is disseminated for “education only” and should not be viewed in any way as a recommendation to buy or sell futures products.”
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